A blog dedicated to raising up young adults of the caliber of Daniel, Paul, Moses, and Esther.

Thursday, January 19, 2017

Personal Integrity vs the Safety of the Herd

Consider these Biblical questions.Did the astrologers who could not describe or
interpret King Nebuchadnezzar’s dream not only keep their heads – did they also
keep their jobs? (Daniel 2)How about
the magicians in Pharaoh’s court, who could duplicate some, but not most, of
the plagues inflicted on Egypt before the Exodus? Did they keep their
jobs?(Exodus 7ff) Or the Pharisees of
Paul’s time, who opposed a nascent movement called The Way in Acts 5?Did they keep their situation?

Nate Silver, in his book, The Signal and Noise, has a
fascinating explanation for the many financial traders who continued to follow
the herd’s bad financial practices in the run-up to the 2008 great
recession.He points out four basic
possibilities:

(1) The trader buys
and the market rises.In this case,
it’s business as usual.Everyone is
happy when the stock market makes money.The trader gets a six-figure bonus and uses it to buy a new Lexus.

(2) The trader sells
and the market crashes.If the
trader anticipates a crash and a crash occurs, who will look like a genius for
betting on it when few others did.There’s
a chance that he’ll get a significantly better job – as a partner of a hedge
fund, for instance.Still, even geniuses
aren’t always in demand after the market crashes, and capital is tight.More likely, this will translate into
something along the lines of increased media exposure:a favorable write-up in the Wall Street
Journal, a book deal, a couple of invitations to cool conferences, and so forth.

Silver then cites a fascinating, hilarious, and sobering
description of (2):Michael Lewis’s The
Big Short, which was also made into a funny movie. Here’s Silver’s
description of the other two possibilities:

(3) The trader buys
but the market crashes.This is no
fun:he’s lost his firm a lot of money
and there will be no big bonus and no new Lexus.But since he’s stayed with the herd, most of
his colleagues will have made the same mistake.Following the last three big crashes on Wall Street, employment at
securities firms decreased by about 20 percent. That means there is an 80 percent chance the
trader keeps his job and comes out okay; the Lexus can wait until the next bull
market.

(4) The trader sells
but the market rises.This scenario,
however, is a disaster.Not only will
the trader have significantly underperformed his peers – he’ll have done so
after having stuck his neck out and screaming that they were fools.It is extremely likely that he will be
fired.And he will not be well-liked, so
his prospects for future employment will be dim.His career earnings potential will have been
dramatically reduced.The Signal and the
Noise, p. 354-355.

Silver makes the case that most traders will pick (3),
which, in economics, is why it takes a good long time to burst a bubble:“The
market can stay irrational longer than you can stay solvent.”(John Maynard Keynes, op. cit. p. 360)The trader picks (3) even though he or she
knows that what is happening is irrational, unsustainable, and ultimately,
unethical.

Now imagine you are a Christian mortgage broker, or a
Christian investment manager or adviser running some sort of trust fund, in the
run-up to the Great Recession of 2008.I’ve
met several, and it’s extraordinarily hard to not fall into (3), the safety of
the herd.(To their credit, the ones I
know did NOT do so.)

This basic human dynamic of communal cooperation, altruism, or selfishness has been explored and confirmed in both behavioral economics and social psychology. Here's the behavioral economics version:

Further research by Ernst Fehr and his colleagues has show that consistent with Andreoni's finding, a large proportion of people can be categorized as conditional cooperators, meaning that they are willing to cooperate if enough others do. (Richard Thaler, Misbehaving, 2015, p. 146).

Nobel Laureate Joseph Stiglitz summarizes the social psychology version of the same idea:

Recent advances in the study of social norms
show that many or even a majority of people will abstain from an individually
beneficial but socially harmful action if they perceive that most people do
too. But the converse is also true. This has an important consequence: desirable behavior can quickly degrade when
people are exposed to a sufficient number of transgressions.The Price of
Inequality, 2012, p. 123.

If in fact we are going to Babylon, as Mark Labberton, David
Kinnaman, and others firmly believe, then we face a safety of the herd problem
with eternal consequences.Describing
the original exile to Babylon (605BC) Michael Jossef writes:

What made [the Jewish exiles] ordeal all the more enticing
and seductive that they were not, strictly speaking, imprisoned or
enslaved.Rather, they were placed in
luxurious surroundings in Babylon.They
lived in the palace of King Nebuchadnezzar, and they were surrounded by
pleasures and enticements.Even though
they had been forced into exile under violent circumstances, they landed in the
lap of luxury.No doubt, these young men
felt a certain degree of curiosity and wonder in everything they saw – the
beautiful buildings and gardens of Babylon, the furnishings of gold, silver,
and fine imported fabrics.All the
luxuries of the ancient world were placed at their disposal.

So Daniel and his companions faced a dilemma, and it is much
like the dilemmas you and I face.We
live in a world that is hostile to our faith, our values, and our beliefs, yet
it also offers many materialistic enticements and sensuous delights.We are tempted to wonder, can such a world of
luxury and wealth be so bad?Can the
things of this world be so wrong if they feel so right? Daniel pp. 29-30

Many Bible scholars believe the sons and daughters of Judah’s
nobility did exactly that – they blended in, went along to get along, and had a
nice comfortable Babylonian life – eschewing their Jewish faith.I firmly believe that this choice -- personal
integrity vs the safety of the herd -- will be exactly the choice our young
people will face in the decades ahead.

Paul had very strong views about this:“Surely you remember, brothers and sisters,
our toil and hardship; we worked night and day in order not to be a burden to
anyone while we preached the gospel of God to you.” (1 Thessalonians 2:9).It was Paul’s teacher and mentor, Gamaliel,
who stood up to the herd and said of The Way:“[I]f it is from God, you will not be able to overthrow them.You may even find yourselves fighting against
God!” (Acts 5:39)

A profound question is how we prepare young people to have
personal integrity -- standing firm against the seeming safety of the
herd.Clearly they will have to diligently work hard, and be more capable than their peers (Daniel
6:3).They will need to be incredibly
well educated – Daniel, Paul, and Moses well educated of their time, and Esther
deserves honorable mention.I am
convinced they will need to be entrepreneurial, quite capable of tent-making,
to take a lesson from Paul (and Moses).They
will be tactful and diplomatic leaders (Daniel 2:14).They will need to be incredibly wise, far
more than adept information processors.They will need to be able to think “outside the box,” which starts by
being tuned in to the creator of the universe (Numbers 12:3). Self-control will
be crucial.

Probably Pharaoh’s and Nebuchadnezzar’s magicians did keep
their jobs – although arguing from Biblical silence is risky. Clearly the far
majority of the Pharisees fought against the Christian movement through AD
70.We do have one notable Biblical exception
where following the safety of the herd did NOT work out so well, and that would
be the conclusion of the story of Daniel in the Lion’s Den:

Then the king gave orders to arrest the men who had
maliciously accused Daniel.He had them
thrown into the lion’s den, along with their wives and children.The lions leaped on them and tore them apart
before they even hit the floor of the den.(Daniel 6:24)

No comments:

Post a Comment

Thank you for posting a comment. We enjoy interaction with our readers.